The founder of Dilmah, Merrill J. Fernando, and his son Dilhan have been in New Zealand recently signing off on a new round of ads created by small Kiwi agency Curtiss and Spence and overseeing the Real High Tea Challenge. We sent Dilhan, who is being primed to take over from his father as the face of the brand, a few questions.
- Check out the story of the brand’s now famous slogan here.
1) Do some people think you’re a made up family developed by some multi-national food conglomerate?
There are those who do, but fortunately only a minority, since the style of our communication is quite simple and honest and therefore in most cases understood to be sincere. With the added influence of my father’s personal response to customers who write to him, of Facebook, Twitter, our blog and other media that we handle in the same, very personal style, many understand that the ‘Dilmah Family’ and our TVCs are not the creation of a multi-national corporation, but a sincere expression of my family’s values and commitment to quality.
2) What’s your connection with New Zealand? And why do you work with a New Zealand agency?
New Zealand was the second country in which my father launched Dilmah. It is also one that holds strong emotions for my family given the long association we have had with John Burton (our partner in Dilmah New Zealand) and his family, now over three generations. In those early days, nearly 25 years ago, a young adman – Daron Curtiss – convinced my father to do something he would not normally have considered: to tell his story directly to his customers, by appearing on his own television commercials. Daron’s ideas were very different to the convention, especially at that time, and he continues to work with Dilmah to this day.
3) How are sales going in New Zealand? How big is the company now? And where are the emerging markets for your products?
Dilmah has been number one in New Zealand for a decade. That is no mean feat given the fact that we have during that time faced numerous challenges, including that one of the two main retail customers for Dilmah owns our main competitor [Bell is owned by Foodstuffs but is being prepared for sale] in the tea category. Yet we have grown, initially through the persistence of my father in relating his story and breaking through the opposition he faced to a tea producer bringing his own tea direct to market. Thereafter it has been the quality of Dilmah and the sincerity of our story that has endeared tea drinkers to our family tea.
Our company is ranked amongst the top ten tea brands in the world but that does not mean a great deal since we are very small in comparison with our multi-national, multi-brand competitors. However, that statistic is important since we maintain our founding commitment to quality, to the purity of Single Origin Tea and to integrity, as expressed by my father’s philosophy of making ‘business a matter of human service’. While we are proud to be number one in New Zealand, we are a niche, speciality brand in most countries because even in the UK, tea is commoditised to an extent where it is price and not quality that determines the fate of a brand. That is a compromise that we will not make. Hence we remain niche and that is our preference for quality is the only option for Dilmah. It is a tribute to New Zealanders that their appreciation of quality in tea is such that Dilmah remains number one.
We are present in nearly 100 countries now and the emerging markets would be China, where tea is revered and high quality teas respected, and also the US where an appreciation of quality in tea is emerging.
4) You’re big on family ownership and local employment. Was Dilmah ahead of its time in terms of corporate social responsibility?
It is not solely family ownership, but family values as a foundation for our business that made my father ahead of his time. In the 1960s when he began the practice of supporting staff and their families, evolving with the success of the business to a much larger commitment to supporting the underprivileged and marginalised generally, my father’s intention was to build his business on family values of caring and sharing. That founding pledge was crystallised in the philosophy of making business a matter of human service. It is ingrained into our business through my family’s MJF Charitable Foundation and Dilmah Conservation which benefit from 10 percent of our gross (pre-tax) profits, a commitment that is written into the articles of association of our businesses.
At the time my father conceived this intention, the business of business was considered solely generation of profit. It was neither fashionable nor acceptable for businesses to engage in humanitarian work. That has changed and ethics are at the fore today, although in most cases superficially so through the often misused concept of corporate social responsibility. In working towards the dignified empowerment of differently abled children, war widows, in building schools and hospitals and a host of other activities including supporting worthy humanitarian causes in New Zealand, we have much greater meaning and force in our commitment to our family business. It is one thing to show a profit at the end of the year, and quite another to know that we have in the process transformed the lives of thousands of people who may otherwise not have had a chance in life. It is a deeply fulfilling and motivating aspect of our business that I hope others will seek to emulate.